Money Managers Live

No Longer High-Yield But Definitely Still Junk

Written by Nathan White, Chief Investment Officer of Paragon Wealth Management

Simply amazing.  Junk bond indexes and funds should now drop the “High Yield” description that they use in their names.  With these bonds now yielding around 5% we have sold out of most of our positions in this area.  At this level the returns are just not worth the risk.  That doesn’t mean junk bonds will blow up any time soon but we would rather sell high and take what the market is giving us at this time.  Junk yields at 5% are a direct consequence of the Fed’s Zero Interest Rate Policy as investors fight for anything with yield.  It wasn’t too long ago when you could get 5% on a money market! 

To view the entire article please visit: barrons.com

Here is an exerpt from the article:

The 5% yield barrier has proved no match for this Federal Reserve-fueled junk-bond market, which last night reached yet another all-time record-low average yield-to-worst of 4.97%, according to the Barclays US High Yield Index. It marked a new level of market capitulation to central-bank forces as it’s the first time the index has dipped below 5% in its 30-year history (before January the market had never even fallen below 6%). The average price of 107.31 cents on the dollar also marks a record high.

The other widely followed market index, the Bank of America Merrill Lynch High Yield Master II Index, closed last night within a whisker of 5%, at 5.005%, with the average dollar price closing above the 107-cent mark for the first time ever at 107.20.

“The most surprising thing this shows is that there’s really no yield floor for this market,” says Brad Rogoff, head of credit strategy at Barclays. “Those mental barriers really haven’t existed that we thought existed maybe a year ago.”

With the Fed and central banks around the world keeping interest rates near zero and pumping money into the financial system, investors have been encouraged, if not forced, to invest in the highest-yielding investments around, even if those yields aren’t that high anymore. All this liquidity and low borrowing costs have helped companies shore up their balance sheets, and default rates remain negligible, which further emboldens investors to take on credit risk.

Rogoff says the high-yield market’s main attraction used to be – as its name would indicate – its high yields. At sub-5% average yields now, the market’s main justification is its comparative yield versus other types of bonds, namely its risk premium over Treasuries. The option-adjusted spread on the Barclays index stands at 406 basis points over Treasuries, below its historic average but still far wider than the historic tight of 233 bps reached on May 23, 2007. The spread of the Bank of America index stands at 424 bps, above its all-time low of 240, also recorded in May 2007.

“Usually this is a market that’s traded based on yield, but now it feels like it’s trading based on spread. It’s much tougher to justify based on historical yield standards but on spread, its reasonable,” Rogoff says. The average spread could still tighten a bit more, he adds, but any further tightening “is not necessarily in conjunction with where rates are now,” meaning Treasury rates would have to rise before junk bond spreads compressed much further, leaving all-in junk-bond yields more or less where they are now.

The average dollar price of 107 cents presents another problem, since many junk bonds can be called by their issuer beyond a certain date at 103 cents on the dollar. Rogoff says roughly half of the market is currently trading above its first call price. “Those call dates typically are not tomorrow, but the market is definitely constrained,” he says. “A year ago, you would have thought there was a yield floor created by a dollar price constraint.”.......

To view the rest of the article, please visit: barrons.com

Disclaimer
Paragon Wealth Management is a provider of managed portfolios for individuals and institutions. Although the information included in this report has been obtained from sources Paragon believes to be reliable, we do not guarantee its accuracy. All opinions and estimates included in this report constitute the judgment as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Past performance is not a guarantee of future results.

 

Is The Stock Market Still Safe At These Levels?

Written by Dave Young, President & Founder of Paragon Wealth Management

With the market hitting new highs, this is another question that is regularly asked.  When you look at the market over the long term it provides a different perspective.  Currently, the broad stock market is back to where it was almost 13 years ago.  In August of 2000 the S&P 500 hit a level of 1517.  Then after seven years of ups and downs, in October 2007, the S&P 500 finally hit 1549.  Then five and a half years after that, the S&P 500 hit 1514 again.  The bottom line is that it has taken almost 13 years for the S&P 500 to get back to the level it was at in August 2000!

Stock prices are driven by their earnings.  Earnings have increased over 300% since 2000 while stock prices haven't moved much.  In my opinion, it appears that stocks are still a good value even though we are hitting new highs.    

Managing Money is Difficult

Managing money is difficult.  When you try to protect against downside exposure, often it hurts your upside return.  Likewise, if you are too aggressive, then your account can be decimated in an extreme bear markets like we experienced in 2002 and 2008.

By way of example, some of the brightest and most talented money managers are hired by the large University Endowment Funds.  The endowment funds for Harvard, Yale, Princeton, Stanford, Columbia and Notre Dame manage about 100 Billion Dollars.

Many of the high profile University endowment funds incurred significant losses in 2008.  It is human nature to be more defensive after getting beat up.   So how did these top managers adjust to their investments 2012 as the stock market hit new highs?

In 2012, the combined average return for these six endowments was only 2.63%.

The bottom line is that even for these top tier managers, with every resource and option imaginable, managing money is difficult.

Paragon Investment Portfolios

We have recently added some new portfolios to our menu of investments.  Below is a brief description of each.  Our investment process is to help you determine your risk comfort level then allocate your funds to an appropriate mix of the portfolios.

Conservative Portfolios:

• Managed Bond Portfolio:  This is a custom bond portfolio.  Treasury, Corporate or Municipal Bonds can be managed.  At this time we do not recommend this portfolio because the amount of risk taken in most bonds versus the potential reward is not prudent.
• Managed Income:  This is our flagship, active, conservative portfolio created in 2001.  It can invest in all types of bonds, convertible stocks, preferred stocks, utilities, real estate, alternative funds and cash.  This portfolio has performed well in this difficult low rate environment because of its flexibility to move between and avoid various conservative asset classes.
• Paragon Private Strategies:  This new diversified portfolio invests in private equity.  It takes a conservative approach and provides consistent income by investing in income producing assets.  It is only available to accredited investors.

Growth Portfolios:

• Core Portfolio:  This concentrated portfolio focuses on two or three market areas that are at the top of our model rankings.  This portfolio can be adjusted to any risk comfort level and is a relatively low cost alternative.
• Index Portfolio:  This passive index portfolio is invested across a diversified mix of small cap, mid cap, large cap, value and growth strategies within the U.S. market.   It is designed to be a low cost alternative that will track the U.S. market but provides no downside protection. 
• Top Flight:  This is our flagship active diversified growth portfolio and has been actively traded since 1998. It combines several of Paragon's best quantitative models.  Those models include core, seasonality, relative strength and allocation models.  This portfolio seeks to generate superior long term risk adjusted returns.

As always, we appreciate your trust in us and the opportunity to be your advisor.  Please contact us if you have any questions or need assistance.

Disclaimer
Paragon Wealth Management is a provider of managed portfolios for individuals and institutions. Although the information included in this report has been obtained from sources Paragon believes to be reliable, we do not guarantee its accuracy. All opinions and estimates included in this report constitute the judgment as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Past performance is not a guarantee of future results.

Watch out for a Russian in a Speedo

Written by Dave Young, President & Founder of Paragon Wealth Management

I recently returned from a trip to the Dominican Republic.   The trip was for a group of 30 entrepreneurs and their wives who were graduates of BYU.

The trip was great.  It was a chance to get out of the cold.  It was good to network with an upbeat, successful group of people.  The days were nice, sitting on the beach, listening to the waves and enjoying the sun. 

In retrospect, it reminds me of the stock market the past few months.  There has been very mild back and forth movement within a general uptrend.  All in all, it has been a good time to be invested.

About midweek, I was involved in a beach volleyball game.  Everything was going great until this guy from Russia wearing a Speedo decided to go for the ball in the zone I was covering.   He hit me full force with his shoulder going into my left lower ribcage.  Both of us ended up out of bounds on the ground - with me getting the worst of it - with two broken ribs.

That sudden change of events kind of put a damper on the trip.  Much like market sell-offs put a damper on nice market up-trends. 

The moral of the story is to never be complacent.  When investing -especially when times are good- we are always looking over our shoulder and preparing for the next bad thing that might happen.  They say the best traders are somewhat paranoid.  When investing, hope for the best but prepare for the worst.  When in the Dominican Republic - watch out for that Russian in a Speedo...

Disclaimer
Paragon Wealth Management is a provider of managed portfolios for individuals and institutions. Although the information included in this report has been obtained from sources Paragon believes to be reliable, we do not guarantee its accuracy. All opinions and estimates included in this report constitute the judgment as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Past performance is not a guarantee of future results.

 

Walking the Tightrope

Written by Dave Young, President of Paragon Wealth Management

Investing has always been difficult.  I've managed money long enough that I've experienced and survived the Crash of 1987, the Asian Crisis in 1996, the Tech Wreck from 2000 to 2003 and more recently the Crash of 2008.  One of my fundamental biases has always been a mistrust of the markets mixed in with slight paranoia.  I believe that mindset is one reason why Paragon is still managing money after 26 years.

What has been different for the past couple of years is the length of the cycles that we track.  Historically, markets and sectors trend consistently for six to eighteen months - or longer.  Much of our historical outperformance has come from our ability to lock onto those trends and generate excess performance in our client accounts. 

Since 2010, those trends have been much shorter with much more back and forth motion.  In addition to the usual factors that effect the markets positively and negatively there has been a new elephant in the room.

That elephant is Government.  There have been issues created by government actions at home and in Europe.  Then you add in the effect of hundreds of new government regulations on the economy, a government spending trillions of dollars more than it has and a federal reserve stimulating the economy,  i.e. QE1, QE2 and QE3.

I won't even go into the effects of market uncertainty created by the upcoming presidential election.  That election will determine whether we move toward an even bigger government and more regulation or we let  the free market control our economy.  Not to mention the effects of the fiscal cliff we are facing after the election regardless of who is elected. 

Because the government factor is more difficult to measure and more random, I believe that it has contributed significantly to the shorter term, back and forth trends.   This uncertainty has added additional inputs to the way that we manage money and has at least temporarily, forced us to be more conservative than we would like.

Even when our models are completely bullish we still have to hold back some cash because of the increased level of uncertainty created by the government.  It is frustrating to hold extra cash,  but it does allow us more flexibility to deal with unknowns that may occur.   

There is an old saying that bulls make money, bears make money but hogs get slaughtered.  Right now you could call us moderately bullish but definitely not hoggish.

Disclaimer
Paragon Wealth Management is a provider of managed portfolios for individuals and institutions. Although the information included in this report has been obtained from sources Paragon believes to be reliable, we do not guarantee its accuracy. All opinions and estimates included in this report constitute the judgment as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Past performance is not a guarantee of future results.

How Can Conservative Investors Survive in this Low Interest Environment?

Paragon Wealth Management advised conservative investors to think twice when investing in CDs or money market funds.

“Investors who save money in CDs and money market funds don’t have a lot of options right now,” said Dave Young, president and founder of Paragon Wealth Management. “With inflation rates at 3 to 4 percent and interest rates between 0.5 and 1.9 percent, savers are actually losing money in their "conservative" accounts.”

Ben Bernanke, chairman of the Federal Reserve, said they’ll keep interest rates this low until sometime in 2014.

“Savers can either stay ultra conservative, and watch their savings go down each year or take a little more risk in order to get higher returns,” said Young. “On a one to ten risk scale, with ten being the most risky, I believe that many investors would benefit by slightly moving up the risk scale.  If they move from a level of one to a three or a level of three to five they could potentially, significantly increase their earnings.

Young said, "On the other hand, investors shouldn’t jump from very low to very high risk.  That is usually when you see problems. Sometimes investors get tired of earning one percent, so they quit and move over into something extremely aggressive that promises a 20 percent return. He cautioned investors not to get extremely aggressive and invest in things they don't understand, because that is often when they lose everything."

“It is important for investors to determine their asset allocation based on their individual risk tolerance,” said Young. “This will help them stay invested over the long-term and optimize their investment choices.”

Making sure your portfolio is structured properly is more important than ever with interest  rates this low.  

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Watch this video to learn more about how to invest when interest rates are low.

Disclaimer
Paragon Wealth Management is a provider of managed portfolios for individuals and institutions. Although the information included in this report has been obtained from sources Paragon believes to be reliable, we do not guarantee its accuracy. All opinions and estimates included in this report constitute the judgment as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Past performance is not a guarantee of future results. 

Gold Falls 5% In A Day!

Written by Nathan White, Chief Investment Officer, Paragon Wealth Management

The price of gold fell over $90 today to close just below $1700/ounce.  That would be the same as the Dow falling 650 points! Moves like this highlight my view of the risk inherent in owning gold at these prices.  The fall was due to comments by Fed Chairman Bernanke before Congress today where he indicated that QE3 will probably not be needed.  Initially many thought that the downward move was just a kneejerk reaction but then it continued down.  What I find interesting is that many gold bugs (i.e., people who love gold)  tend to despise the Federal Reserve and its actions or existence and buy gold to protect themselves.  However, after they have bought gold they then have a vested interest in the Fed continuing the actions that they fundamentally disagree with!  Talk about irony.  So when the Fed hints that they won’t be pumping in as much money through QE actions – whoosh, down goes the price of gold. 

I for one am glad to see the Fed not continue another program like QE that just serves to distort market prices in my opinion.  I don’t want any more QE’s as I think the economy can stand on its own. Although I’m very worried about future inflation I don’t think gold would be the best hedge as it has already priced in significant inflation.  I’m worried about how the Fed will eventually unwind its massive balance sheet and the consequences that would follow.  This unwinding would be a tightening of monetary policy and bad for gold.  Gold has been a major beneficiary of the historic easy-money actions of the Fed but at this point the Fed is mostly out of ammo and its actions are producing fewer and fewer marginal gains which are not worth the cost.  It’s like the junkie who needs to keep taking more and more to get a high and you know how that story ends.  Let’s hope the economy gets stable enough that it will be able to withstand the potential ramifications of this unwinding….     

Disclaimer

Paragon Wealth Management is a provider of managed portfolios for individuals and institutions. Although the information included in this report has been obtained from sources Paragon believes to be reliable, we do not guarantee its accuracy. All opinions and estimates included in this report constitute the judgment as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Past performance is not a guarantee of future results.  

How to Invest with Interest Rates so Low

 

Written by Dave Young, President of Paragon Wealth Management

Usually it's stock market investors that feel stressed.  Now, conservative investors are feeling the pinch too.

Life used to be simple.  You took your retirement savings and put it into a savings account, annuity or bank CD.  You didn't earn much,  but you did get 4% or 5% and that was enough to make your retirement plan work.

Now things are not so easy.  Interest rates are the lowest ever.  Conservative savings options are paying between zero and one percent.  If you want to take a chance and tie your money up for ten years in a U.S. government Treasury Bond -  then you can get a whopping 1.9%!  Soon you may have to pay to put your money in a bank account.

Unfortunately, it doesn't look like the situation is going to change anytime soon.  Ben Bernanke, Chairman of the Federal Reserve,  said  they will keep interest rates this low until sometime in 2014, three years from now.

So for the foreseeable future, conservative savers will watch their accounts decline in value, even if they don't spend any of their money.  In 2011 the inflation rate was 3.2%.  If you were lucky and earned 1% interest on your CD -  then you lost 2.2% for the year.  Keep that constant for five years and your $100,000 in savings is worth only $89,000 in real terms.  It's even worse if you pay taxes on the interest that you earned.  All in all...not a good plan for building wealth.

So, what are the alternatives? 

Option one: Stay ultra conservative and watch your savings go down in value each year.

Option two:  Take on a little more risk but clearly understand the risk you are taking in order to get higher returns. 

It doesn't make any sense to move from very low risk to very high risk.  Unfortunately many investors make this mistake.  If you decide to take more risk then you must be absolutely certain that you fully understand the amount of downside risk you are taking on. 

For example, on a one to ten scale, as long as the bank doesn't go broke, a bank  CD might have a risk level of two.  A bond might be a risk level of four.  A real estate project might have a risk of level of 6.  A gold purchase might be an 8.  An investment in your neighbors business might be a 10.

The point is that you need to clearly understand how much risk you are taking before you invest your money.  Sometimes, when investors become weary of getting 1% they throw in the towel and move over to something very aggressive that promises a 20% return.  Such rash behavior usually results in losing everything.

Not understanding the risk of a potential investment causes some investors to stay stuck in their low interest investments indefinitely.  They are afraid to make any changes because they aren't sure how much risk they are taking. 

On the other hand, not understanding risk properly sometimes causes investors to invest in very risky things that they should never consider.  That is why it is so important to fully understand the risk you are taking.

In order to get a better return an investor might consider moving from a one on the risk scale to a three.  Or maybe from a three to a five.  But it is foolish to move from a one on the risk scale to a seven or ten.

Recommendations

Many investors use our conservative Managed Income portfolio in order to generate income and control risk in this very difficult environment.   This conservative portfolio follows a strategy of moving between various conservative investments depending on market conditions.

It's primary objective is to preserve principal.  Its secondary objective is to generate returns.

This conservative portfolio has returned an annual return of 6.03% compounded, net of fees, to investors from October 2001 through December 2011.  See www.paragonwealth.com for the full track record and disclosures.

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Watch Paragon's video most recent video to learn more about how to avoid investment scams.

Disclaimer

Paragon Wealth Management is a provider of managed portfolios for individuals and institutions. Although the information included in this report has been obtained from sources Paragon believes to be reliable, we do not guarantee its accuracy. All opinions and estimates included in this report constitute the judgment as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Past performance is not a guarantee of future results. 

 

Advice on Investing in Long-term Bonds

photo by Shutterstock

Although bonds have become popular the past two years, our wealth managers advise investors not to put their money into long-term bonds because we believe investors could be hurt significantly if rates increase.

"It is our opinion that bond investors will be the next group of investors to get hurt," said Dave Young, President and founder of Paragon. "In the 2000 bear market, stock investors got crushed. Then, many of those same investors moved to real estate for protection and got beaten up again in 2008. Treasury bonds performed well the entire time. As a result, since the beginning of 2009, investors have put a net $620 billion into bond funds while they have withdrawn $100 billion from stock funds. This has pushed rates to all time lows."

Our portfolio managers claim that the current quantitative easing by the Fed may temporarily slow down increasing rates, but it won't stop them.

"Many bonds do not have near enough return to compensate for their downside risk," said Nathan White, Paragon's Chief Investment Officer. "With interest rates so low, we believe that investors will not find the safety or the returns they seek in most bonds."

Nathan said bonds have been in a 30-year bull market, which lulled investors into a false sense of security.

"Going forward, the returns that people will likely see in bonds will be very low at best or sharply negative at worst," said Nathan. "Unfortunately for bond investors, we believe it could be the negative scenario."

We advise investors to be aware of the maturities and quality of their bond holdings. We encourage investors to consider shortening the maturity of their bonds and adding high quality dividend stocks as an alternative.

About Paragon Wealth Management

Paragon Wealth Management is a wealth management firm that actively manages all types of traditional and retirement accounts such as IRA and 401(K) rollovers, and pensions and trusts. Paragon is a registered investment advisor and has fiduciary responsibility. Paragon received the Best of State Award in Financial Services in 2008, was listed on Wealth Manager Magazine's Top Wealth Managers List in the U.S. in 2008, received the Small Business of the Year Award in 2008, and was listed on WealthManagerWeb's Top Wealth Manager's list in 2010.

Paragon cannot guarantee the accuracy of information from other sources. Opinions are as of the dates indicated only. This report is not a solicitation for any security. Past performance is not a guarantee of future results. Investments in securities involve the risk of loss. Do not rely upon this information to predict future investment performance or market conditions. This information is not a substitute for consultation with a competent financial, legal, or tax advisor and should only be used in conjuction with his/her advice.

A Seesaw Market?

 

Photo by Hoyasmeg

Written by Dave Young, President of Paragon Wealth Management

As seen in Paragon's 3Qtr 2010 Print Newsletter

September is known as the worst month to be in the stock market.

At the end of August, many media outlets and TV talking heads ran stories about how bad this September would likely be. Investors moved money into bonds and gold and avoided stocks. Some of our clients called and asked to be taken out of the market purely because it was September.

What did the market do? Of course, it did what it had to do in order to cause the most grief to the majority. Since everyone expected it to go down... it went up. In short, we just had the strongest September since 1939. The S&P 500 gained nine percent for the month. Unfortunately, because of outflows into bonds and gold, many investors did not participate in the stock rally.

Overall, it was a seesaw quarter.

The markets were up sharply in July, down sharply in August and then up even harder in September. The back and forth movement has been more difficult than usual this year with the S&P 500 either gaining or losing at least four percent in each of the last five months. 

Those extreme up and down swings make our life much more complicated. When the markets are weakening, we make adjustments to protect ourselves. When they are strengthening, we make adjustments to prepare for upside movement. We have been stuck in this back and forth no man’s land since April.

We prefer trending markets. Either trend up or trend down, but just be consistent.

When the market is trending, it allows us to capitalize on the trend and ride it as long as it lasts. When it is whipsawing back and forth, we are forced to make constant adjustments, but it is difficult to make progress.  Effectively capitalizing on the trend is how we have significantly beaten the S&P 500 historically. 

So far, this year’s market action reminds me of 1994. The good news is that markets never swing back and forth like this forever. Eventually, they break out and move in one direction.

MANAGED INCOME AND TOP FLIGHT PERFORMANCE

Our conservative portfolio, Managed Income, has done well for the first three quarters of this year with a 4.8 percent return, net of fees. This has been a very challenging year for our conservative portfolio. With interest rates at extreme lows, it has been difficult to generate safe returns and still avoid the potential danger posed by increasing interest rates.

You might be wondering why potentially increasing interest rates are such a problem. If interest rates go up one percent, then a 10 year maturity bond will lose about 10 percent of its value. Likewise, an increase of two percent would create about a 20 percent loss and an increase of three percent would create about a 30 percent loss.

With interest rates at all time lows, many supposedly safe bonds are really ticking time bombs.

Investors have been piling into bonds in a big way. Since the start of 2009 investors have put a net $620 billion into bond funds while they have withdrawn $100 billion from stock funds. When rates do eventually go up, investors who ran to bonds for safety will be surprised to find themselves saddled with big losses they thought they were immune to. 

Most conservative funds simply buy and hold bonds. Those types of funds will likely get hurt when rates go up. In contrast, Managed Income attempts to own bonds when they have favorable risk/reward characteristics and avoid them when they are unfavorable. That is why this has been a challenging environment for Managed Income. We have been forced to pull returns from other conservative areas while avoiding the majority of corporate and treasury bonds. Managed Income has performed well year-to-date.

Our growth portfolio, Top Flight, has had challenges as well. It is at a virtual breakeven for the year, with a -0.4 percent return year-to-date. Its benchmark, the S&P 500, is up 3.9 percent year-to-date. Most of that lag in performance can be attributed to difficulty in two months, January and July. If you break it down further, it is the back and forth whipsaw characteristic of this year’s market that has made it difficult.   

We have spent a lot of the year adjusting and changing direction, right before the market reverses direction.

 As I mentioned earlier, at some point the choppiness usually ends and the trending begins. Unfortunately, we aren’t notified in advance when that will be. That is why we are forced to constantly adjust so that we will be in position to capitalize on the change in trend when it occurs.

Even though Top Flight has slightly underperformed through the third quarter,  we are not terribly concerned. Looking at the big picture, Top Flight has beaten the S&P 500 over the past three, five, seven, 10 and 12 year time frames (see complete track record and disclosures on Paragon's website, www.paragonwealth.com).

To be continued next week...

Paragon Wealth Management is a provider of managed portfolios for individuals and institutions. Although the information included in this report has been obtained from other sources Paragon believes this to be reliable, we do not guarantee its accuracy. All opinions and estimates included in this report constitute the judgment as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Past performance is not a guarantee of future results.

Dave Young Gave Investment Tips on PCTV

 

Dave Young, President and founder of Paragon Wealth Management, was a guest on Park City TV's Mountain Morning Show a few weeks ago. 

Karilyn Frazier, Park City TV's Mountain Morning Show Host, asked Dave several questions about where investors should put their money and which markets are doing well.

"At Paragon we make our decisions based on our quantitative models," said Dave. "Currently, Brazil, China, and the Pacific Rim are showing a lot of strength in our models. We suggest investors talk to a financial advisor before making decisions on where to put their money in the stock market."

Karilyn also asked Dave what investors should do if they have $100,000 and are not sure what to do with it. She asked Dave if investors should put their money in a CD.

"Each investor has a different situation," said Dave. "At Paragon, we determine each investors' risk tolerance level, their goals and objectives, and then help them create an investment strategy that is right for them. If five people came to us with $100,000, we would help each person differently."

Dave said if investors determine their risk tolerance and goals and objectives properly, they will be able to stay invested for the long-term.

Paragon Wealth Management is a provider of managed portfolios for individuals and institutions. Although the information included in this report has been obtained from other sources Paragon believes this to be reliable, we do not guarantee its accuracy. All opinions and estimates included in this report constitute the judgment as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Past performance is not a guarantee of future results.